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Vetting investments and projects

Vetting investments and projects

10 Apr 2023

Last week, regional media outlets once again raised alarm over another “Chinese Project” in Sri Lanka. Over the last few decades, time and again geopolitical reveries, lack of policy consistency and poor diplomacy has left Sri Lanka in damage control mode in responding to rational, and at times irrational concerns raised by regional and extra regional powers.  

The repeated scrutiny of foreign investments and collaborative projects by Chinese entities in Sri Lanka by other nations, point to the need for policy transparency and a robust diplomatic mechanism in Colombo. It is also evident that Sri Lanka needs to formalise a national security and foreign policy vetting process for foreign investments and collaboration with local state and private sector.

In 2020, India raised concerns about Sri Lanka awarding a contract for a mixed renewable energy project for the islands off the Jaffna peninsula, to a Chinese firm. The Chinese firm had followed the procurement procedure and won the tender. However, once concerns were raised, Colombo moved to back-peddle on the matter and halted the tender. China questioned why there was a reversal, pointing out if projects in the North of the island were off-limits to Chinese investments.

The incident with the planned visit of the Chinese satellite Tracking vessel – Yuan Wang 5 to Hambantota International Port, also caused great controversy, aided by fear mongering through some of the regional media outlets. The visit of the Chinese vessel, which again had been granted permission, was retracted and then later rescheduled.  Once again signalling policy inconsistency in Colombo. Sri Lanka had ample channels to keep India informed about the visit of such a vessel, which the naval top brass and seasoned diplomats in Colombo would have known would create a stir in New Delhi. However, they were not informed, even though Sri Lanka had established a tripartite nation security coordinating office in Colombo, with their partners India and the Maldives.

Over the last few years, both the Yahapalanaya and Rajapaksa Governments have moved to create academic collaborations between Indian, Chinese and Sri Lankan universities in varying scale.

The most recent concerns raised citing “Intelligence” sources highlights neighbouring India’s concerns about a “Chinese radar” station near Dondra Head in the South. This is not the first time such concerns have been raised about collaboration efforts between Chinese Universities and local academia such as the Ruhuna University. Several years ago, diplomats and regional media made similar claims when a weather monitoring apparatus was fixed at Ruhuna University.

It is learnt that the current project, which has been discussed since 2018 has only held its first stakeholder meeting in late January, with members from the defence and naval communities present at the meeting. No facility, nor “Radar” centre has been established as of today (9). The project, which is said to provide Ruhuna University Generation 1 capacity optical satellite imagery from a Chinese constellation once completed, can be used for a range of studies including in agriculture, irrigation, cloud pattern analysis, weather prediction, coast conservation and town planning. Such generation one optical imagery systems are not cutting edge technology, and weather penetration ability due to the lack of Synthetic Aperture Radar capabilities to see through clouds and other weather effects. But if established, it may be the first such facility that allows local academics to have access to such technology.

As Sri Lanka finds its feet following an unprecedented economic crisis, attracting the right kind of investment and collaboration opportunities will be vital for future stability and growth. President Ranil Wickremesinghe recently stressed that he does not want Sri Lanka to get entangled in the great power rivalries that are now playing out in the Indian Ocean. Sri Lanka is currently reviewing its security and defence architecture. As such, it would be prudent for the Government to develop a clear national security and foreign policy through broad consensus, and clearly communicate such to the world. To avoid and to navigate great power concerns about investments and collaborations with foreign countries, Sri Lanka should also create a national security and forging policy vetting system which would prioritise national interest.



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